DAX Reaches Record High Above 23,000 Points Driven by Defense Stocks and Anticipated Interest Rate Cuts

The German DAX index surged to a record high, surpassing 23,000 points for the first time, fueled by defense stocks and positive economic signals. The DAX increased by up to 2.8 percent, reaching 23,183.03 points. Rheinmetall led the surge, with its shares experiencing double-digit growth, driven by expectations of increased defense spending. The anticipation of further interest rate cuts by the European Central Bank (ECB) is also boosting investor sentiment, as lower rates make stocks more attractive compared to fixed-income securities. EU Commission President Ursula von der Leyen's proposal to grant automakers more time to meet CO2 standards further supported the market. European stocks have outperformed US stocks since the beginning of the year, supported by strong corporate earnings and relatively low valuations. Despite the economic challenges in Germany, investors are focusing on future profits, with the DAX-listed companies having international exposure.